JANUARY MEDICAID ROUNDUP

Syrtis Solutions publishes a monthly Medicaid news roundup to help you stay informed. The monthly summary concentrates on developments, research, and legislation that pertains to Medicaid program integrity, cost avoidance, coordination of benefits, third party liability, improper payments, fraud, waste, and abuse. Here is a summary of last month's significant Medicaid news.

Read the news here. 

THIRD PARTY LIABILITY REQUIREMENTS IN THE MEDICAID PROGRAM

The Social Security Act, signed into law by President Franklin Roosevelt in 1934, stipulates in the statute § 1902( a)( 25) of the law "... that the State or local agency administering such plan will take all reasonable measures to ascertain the legal liability of third parties ... to pay for care and services" delivered to Medicaid recipients. Essentially, it means that Medicaid becomes the payer of last resort, a term also known as third party liability, or the coordination of benefits. In other words, Medicaid pays last, and if a Medicaid member holds other coverage, such as insurance from an employer, that insurer pays first, and then Medicaid pays any remaining costs.

As much as 10 percent of the Medicaid members across the nation hold additional insurance besides Medicaid, which is considered TPL. Types of TPL include employee insurance, Workers' Compensation, Medicare, COBRA insurance from past employment, casualty insurance, dental insurance, eye insurance, and insurance to cover pharmaceutical costs.

The Deficit Reduction Act passed by Congress in 2005 stipulates in Section 6035 that states are directed to pass laws that force health insurance companies to give the state health insurance premium data involving people who are eligible for Medicaid assistance. Specifics of the DRA include:

• Health insurance companies must hand enrollment information over to Medicaid, or its agent, so member benefits can be coordinated.
• This information is to be used to identify supplementary health insurance coverage so that improper payments are not made and payments made in error are recovered.
• Payments are required to be made as long as the claim is submitted within three years after the medical service was provided.
• Claims cannot be denied as long as the state started action on the claim within six years after the state submitted the claim.

Specifications must be made that health insurance consists of other entities that are by statute, agreement, or contract, legally responsible for paying a claim of a healthcare service; pharmacy benefit managers; managed care organizations; group health plans; and self-insured plans.

IDENTIFYING THIRD PARTY LIABILITY IN MEDICAID

Determining primary health insurance coverage of Medicaid beneficiaries can be achieved by a state through one of three different approaches and still allow the state to comply with TPL criteria, under federal law. The problem is that if only one approach is implemented by the state, savings and recovery are not at their greatest possible amount. The highest level of savings consists of processing at all three of the following points in the process by the state. Here are those processes:

Applicants enrolling in the program are asked about other insurance coverage.

The issue is that some enrollees assume they will be disqualified from Medicaid, so this information is withheld. And, since adding Medicaid coverage might also imply an employment change in which employer insurance coverage is lost, this disclosure might be immaterial soon after the applicant's enrollment.

The state looks for TPL coverage in order to avoid extra cost.

Medicaid eligibility names are cross-referenced with names enrolled in state and national health insurance companies in order to detect primary insurers before the submission of Medicaid claims. But, this practice becomes impossible unless state rules require the timely delivery of insurance data when a state also requires the prompt payment of insurance claims. Additionally, a number of medical services, like those dealing with a pregnancy, must be paid at the time that they are claimed, according to federal law. That means that pregnancy claims have to be paid immediately before recovery can be made from responsible insurers.

Improper payments are recovered.

The third part of a comprehensive TPL plan involves Medicaid's payment, which occurs one of two ways. Medicaid can offset the service provider during the next payment issued for the amount that was overpaid. This is called "provider disallowances." Or, Medicaid receives the overpayment from the correct insurance carrier. This is called commercial insurance direct billings. Strong state policies are required for this third step in a TPL plan to function, since without it, the state can receive denials from insurance companies. The bottom line is that when payment errors are cost avoided, time is not wasted in pay and chase activities.

WHAT AN EFFECTIVE TPL PLAN NEEDS TO INCLUDE

So, in order to gain an efficient TPL plan, immediate and effective discovery of additional coverage is needed at Medicaid enrollment. Also, cost avoidance discovery must take on immediacy when claims are made and past errors need to be resolved quickly. What works best is when the federal directives and state laws mesh to form a truly thorough DRA policy that realizes other health insurance coverage with quick recovery of each claim.

ProTPL offers a solution that provides this critical information in real-time, at the point of sale.

Read more.

MEDICAID 2021 - A YEAR IN REVIEW

 

Syrtis Solutions distributes a year-end Medicaid review to help you stay informed. The yearly roundup concentrates on developments, analysis, and legislation that pertains to Medicaid program integrity, cost avoidance, coordination of benefits, third party liability, improper payments, fraud, waste, and abuse. Below is a list of last year's important Medicaid developments.

Read here. 

MEDICAID NEWS IN DECEMBER

Syrtis Solutions publishes a monthly Medicaid news roundup to help you stay up-to-date. The monthly recap focuses on developments, analysis, and legislation that relates to Medicaid integrity, cost avoidance, coordination of benefits, third party liability, improper payments, fraud, waste, and abuse. Here is a list of last month's important Medicaid news.

Click here to read.

NOVEMBER MEDICAID RECAP

 

Syrtis Solutions delivers a monthly Medicaid news summary to help you stay informed. The monthly roundup concentrates on developments, analysis, and legislation that pertains to Medicaid program integrity, cost avoidance, coordination of benefits, third party liability, improper payments, fraud, waste, and abuse. Here is a list of last month's significant Medicaid developments.

See November's recap.

FY 2021 MEDICAID IMPROPER PAYMENTS

 

Medicaid has been designated a high-risk program by the Government Accountability Office (GAO) since 2003 because of improper payments, low-quality data, and administrative challenges. Earlier in November, the Department of Health and Human Services (DHHS) posted its Agency Financial Report. In FY 2021 Medicaid's estimated improper payments amounted to a staggering $98.72 billion. According to DHHS, the vast majority of these improper payments were a result of inadequate documentation and eligibility errors.

Just recently, CMS published the following Improper Payments Fact Sheet.

What You Need to Know:

• Improper payments represent payments that do not meet program requirements.
• The vast majority of improper payments occur in regards to people who may be eligible for care, but for whom there was an unintentional payment error or a reviewer can not determine if a payment was proper due to insufficient payment documentation from a state or a provider.
• Improper payments do not necessarily represent expenditures that should not have occurred and can include both overpayments and underpayments situations where there is insufficient documentation to determine if a payment is proper in accordance with program payment requirements.
• While fraud and abuse are improper payments, they are not synonymous; it is important to note that most improper payments are not attributable to fraud, and improper payment estimates are not fraud rate estimates.

Improper Payment Measurements:

Medicare

• CMS developed the Comprehensive Error Rate Testing (CERT) program to estimate the Medicare Fee-For-Service (FFS) program's improper payment rate.

• The CERT program cites improper payments in accordance with payment policies on any claim: 1) that was paid when it should have been denied or paid at another amount (including both overpayments and underpayments); and/or 2) for which documentation was insufficient to be an improper payment.

• The CERT program reviews a statistically valid stratified random sample of Medicare FFS claims to determine if they were paid properly under Medicare coverage, coding, and billing rules. If these criteria are not met, the claim is counted as either a total or partial improper payment.

• The majority of Medicare FFS improper payments fall into two categories:

• (1) insufficient documentation; and
• (2) the documentation provided for the items or services billed did not sufficiently demonstrate medical necessity.

Medicaid

• CMS estimates Medicaid and CHIP improper payments using the Payment Error Rate Measurement (PERM) program.

• The PERM program uses a 3-year, 17 state rotation, meaning each state is reviewed once every three years and each cycle measurement includes one-third of all states. The most recent three cycles (2021, 2020, and 2019) combined to form each year's overall national rate.
• PERM ensures a statistically valid random sample representative of all Medicaid and CHIP payments matched with federal funds meets a national precision requirement where CMS is 95% confident that the Medicaid and CHIP improper payment rates are within +/- 3 percentage points.
• The Medicaid and CHIP improper payment national rates are based on reviews of the FFS, managed care, and eligibility components of a State's Medicaid and CHIP program in the year under review.
• In addition, the PERM program combines individual state component estimates to calculate the national component estimates. National component rates and the Medicaid and CHIP rates are weighted by state size, such that a state with a $10 billion program is weighted more in the national rate than a state with a $1 billion program. A correction factor in the methodology ensures that each Medicaid improper payment is counted only once in the combined national rate.

• Medicaid and CHIP improper payment data released by CMS are based on reviews of whether states are implementing their Medicaid and CHIP programs in accordance with federal and state payment and eligibility policies.

Click here to read the white paper Improper Payments - Medicaid's Billion Dollar Problem

Improper Payments Do Not Necessarily Indicate Fraud:

• Improper payment rates are not measures of fraud in CMS programs. Most improper payments are caused by improper or inadequate documentation.
• Improper payments do not necessarily represent expenditures that should not have occurred.

• For example, a majority of improper payments are due to instances where information required for payment was missing, documentation that an eligibility determination was made correctly was missing from the state system, states did not follow the appropriate process for enrolling providers, and/or states did not follow the appropriate process for determining beneficiary eligibility. However, these improper payments do not necessarily represent payments to illegitimate providers or on behalf of ineligible beneficiaries. Had the missing information been on the claim and/or had the state complied with the enrollment or redetermination requirements, then the claims may have been payable. A smaller proportion of improper payments are instances where the State Agency had sufficient documentation to determine that payments should not have been made or should have been made in different amounts, which are considered monetary losses to the Federal Government (e.g., medical necessity, incorrect coding, and other errors).

• Improper payments can result from a variety of circumstances, including:

• 1) services with no documentation,
• 2) services with insufficient documentation, or
• 3) no record of the required verification of an individual's eligibility, such as income, specifically for Medicaid and CHIP.

• Proper payments occur when there is sufficient documentation to support payment in accordance with the program payment requirements. Two examples of proper payments include:

• Payments where the state appropriately maintained documentation of an eligibility verification requirement and appropriately determined eligibility based on program eligibility and payment requirements.
• Payments where sufficient documentation was provided to support medical necessity in accordance with program payment requirements.

Improper Payment Reporting Criteria

• The Payment Integrity Information Act of 2019 defines significant improper payments are defined as either:

• (i) improper payments greater than $10 million and over 1.5 percent of all payments made under that program, or.
• (ii) improper payments greater than $100 million.

• The Office of Management and Budget (OMB) has identified Medicare Fee-For-Service (FFS), Medicare Part C, Medicare Part D, Medicaid, and the Children's Health Insurance Program as susceptible to significant improper payments. The Advanced Premium Tax Credit program has also been identified as susceptible to significant improper payments. In FY 2021, CMS completed the development of the Federally-facilitated Exchange improper payment measurement and commenced measurement activities for future reporting.

CMS/State Collaboration on Improper Payments

• CMS collaborates with states in many ways to share information and help to ensure they maintain the proper documentation to demonstrate that payments are being made correctly. Examples include:.
• Medicaid Eligibility Quality Control (MEQC) Program: Under MEQC, states design and conduct pilots to evaluate the processes that determine an individual's eligibility for Medicaid and CHIP benefits. States have flexibility in designing pilots to focus on vulnerable or error-prone areas as identified by the PERM program and state. The MEQC program also reviews eligibility determinations that are not reviewed under the PERM program, such as denials and terminations.
• Enhanced State PERM Corrective Action Plan Process: CMS works with states to coordinate state development of corrective action plans to address each error and deficiency identified during the PERM cycle. After each state submits the corrective action plan, CMS monitors each state's progress in implementing effective corrective actions. Throughout the process, CMS also provides training opportunities to ensure compliance with federal policies.
• State Medicaid Provider Screening and Enrollment Data and Tools: CMS shares Medicare data to assist states with meeting Medicaid screening and enrollment requirements.
• Enhanced Assistance on State Medicaid Provider Screening and Enrollment: CMS provides ongoing guidance, education, and outreach to states on federal requirements for Medicaid provider screening and enrollment. CMS also assesses provider screening and enrollment compliance, provides technical assistance, and offers states the opportunity to leverage Medicare screening and enrollment activities.
• Medicaid Integrity Institute (MII): CMS offers training, technical assistance, and support to state Medicaid program integrity officials through the MII. More information is located at the Medicaid Integrity Institute website.

Click this link to learn more. 

MEDICAID NEWS FROM OCTOBER

 

Syrtis Solutions distributes a monthly Medicaid news roundup to help you stay informed. The monthly recap concentrates on developments, analysis, and legislation that pertains to Medicaid program integrity, cost avoidance, coordination of benefits, third party liability, improper payments, fraud, waste, and abuse. Below is a list of last month's important Medicaid news.


Read October's news here.